Saks Fifth Avenue shopping sprees aren\u2019t over just yet.
\nThe Chapter 11 bankruptcy of Saks Global, the parent company of Saks Fifth Avenue, sent shockwaves across the luxury retail world this week.
\nThe dramatic move comes barely a year after the company rapidly expanded its 13 million-square-foot real estate footprint with to the recent acquisition of Neiman Marcus and Bergdorf Goodman.
\n
\nSaks Fifth Avenue\u2019s flagship store in New York City remains safe from closure, but others won\u2019t be so lucky.
\nThe disastrous deal for Neiman Marcus and Bergdorf Goodman was built upon $2 billion in debt financing. <\/p>\n
Saks Global is now in the midst evaluating its operational properties, according to the filing, signaling closures, lease negotiations and asset sales to come.
\nLuxury department locations and off-price stores will stay open in the meantime, however, thanks to a $1.75 billion financing package.
\nOren Bitan, partner at the business law firm Buchalter, told The Post that Saks Global has been \u201cteetering,\u201d since the debt-ridden deal in 2024, which took on 36 Neiman Marcus stores across 17 states and two Bergdorf Goodman stores in New York.<\/p>\n
Some closures, however, are already underway.
\nThe company\u2019s real estate portfolio in retail corridors and malls may be its biggest liability \u2014 and its best asset.
\nRecent months saw the company try to stem the bleeding by offloading major properties. The company confirmed in early November plans to close nine Saks Off Fifth stores in cities like Austin, Chicago and Washington, DC.
\nLate last year, the company sold the land beneath a 200,000-plus-square-foot Neiman Marcus in San Francisco. A Saks Fifth Avenue across the street had already closed.
\nSaks Global operates 71 full-line luxury locations, plus off-price locations. That portfolio includes 33 Saks Fifth Avenue stores and 36 Neiman Marcus stores in prime luxury corridors like Beverly Hills and Manhattan, as well as dozens of discount stores like Saks OFF 5th and Last Call.
\nThe company owns or holds the ground leases for 5.5 million square feet across 39 of these stores. These holdings may prove to be the retailer\u2019s most valuable assets throughout the bankruptcy proceedings \u2014 as well as its biggest liabilities.
\nThe land beneath high-value locations in Beverly Hills and San Francisco has already been sold. <\/p>\n
Mark Brutzkus, partner and chair of the consumer products practice at Stubbs Alderton & Markiles LLP, told The Post that the objective for Saks Global is now reducing its massive debt.
\n\u201cOne of the ways they\u2019re going to be doing that is reorganizing their operations and closing what they perceive to be the underperforming stores,\u201d Brutzkus said. \u201cThey\u2019ve already started to do that.\u201d
\nThe land beneath a two-city-block Neiman Marcus in Beverly Hills was sold off just last month. Similar to the San Francisco sale, the deal sold the property to investors and leased it back, thereby gaining liquidity while keeping shoppers. Previous reports pegged the combined sale prices around $100 million.
\nSaks Global could soon face legal action from landlords at its leased locations. The company has already asked courts for permission to shutter four \u201cdark stores,\u201d or retail locations no longer open for business.
\nOff-price stores like Saks OFF Fifth have seen a wave of closures. <\/p>\n
These four dark stores number among the company\u2019s 81 Saks OFF 5th Stores, which are located across more than 20 states. That doesn\u2019t necessarily spell the end of Saks Global\u2019s cheaper retailers, Brutzkus said.
\n\u201cIf it\u2019s an underperforming store, it\u2019s going to close,\u201d Brutzkus said. \u201cThat\u2019s just the nature of the beast in terms of a Chapter 11 bankruptcy.
\nBrutzkus estimated it will take six months to a year before significant closures occur.
\nSaks Global\u2019s flagship on Fifth Avenue, however, is leased from a separate entity, and therefore safe from a sale. The fate of Neiman Marcus\u2019 Dallas flagship is unclear, however. The chain\u2019s 129,000-square-foot location was slated to close early last year, but the decision was reversed days before it hit the chopping block.
\n\u201cI think the foremost question is, are the stores staying open? Are those flagships continuing to exist? I think that\u2019s on everyone\u2019s mind,\u201d Bitan said.<\/p>\n
Saks Global is the largest luxury powerhouse to file for bankruptcy in recent memory, leaving its bankruptcy and thousands of creditors in uncharted territory.
\n\u201cIt\u2019s hard to compare these top luxury retail stores with anything else,\u201d Bitan said. \u201cParty City, Forever, 21 Rite Aid, those are not really in the same league as this.\u201d<\/p>\n
Q: Is Saks Fifth Avenue closing?
\nA: While Saks Global, the parent company of Saks Fifth Avenue, has filed for bankruptcy, the Saks Fifth Avenue flagship store in New York City remains safe from closure.
\nQ: What stores will be closing?
\nA: Some Saks Off Fifth stores have already been closed, and more closures are expected as the company evaluates its operational properties.
\nQ: Will luxury department locations and off-price stores stay open?
\nA: Yes, luxury department locations and off-price stores will stay open in the meantime, thanks to a $1.75 billion financing package.
\nQ: What is the future of Saks Global?
\nA: The company is currently reorganizing its operations and reducing its massive debt, which may involve closing underperforming stores and selling off assets.<\/p>\n","protected":false},"excerpt":{"rendered":"
Introduction to Saks’ Bankruptcy Saks Fifth Avenue shopping sprees aren\u2019t over just yet. The Chapter 11 bankruptcy of Saks Global, the parent company of Saks Fifth Avenue, sent shockwaves across the luxury retail world this week. The dramatic move comes barely a year after the company rapidly expanded its 13 million-square-foot real estate footprint with […]<\/p>\n","protected":false},"author":6,"featured_media":27821,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[23],"tags":[],"class_list":{"0":"post-27819","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-real-estate"},"jetpack_featured_media_url":"https:\/\/i1.wp.com\/nypost.com\/wp-content%2Fuploads%2Fsites%2F2%2F2026%2F01%2F118975303.jpg?quality%3D90%26strip%3Dall&w=1920&resize=1920,1279&ssl=1","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/posts\/27819"}],"collection":[{"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/comments?post=27819"}],"version-history":[{"count":1,"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/posts\/27819\/revisions"}],"predecessor-version":[{"id":27822,"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/posts\/27819\/revisions\/27822"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/media\/27821"}],"wp:attachment":[{"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/media?parent=27819"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/categories?post=27819"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/citystuff.com\/new-york\/wp-json\/wp\/v2\/tags?post=27819"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}